Mass. AG Rule Protects Homeowners from Predatory Shared Appreciation Mortgages

November 6, 2026 — Press Release

Stronger Rules Needed to Ensure Homeowners Aren’t Issued Loans that Cost Them Their Homes

BOSTON – The Massachusetts Attorney General has taken an important step to protect Massachusetts homeowners from risky home equity theft loans with a new rule to provide more transparency around so-called “shared appreciation mortgages (SAM).” 

The new rule provides enhanced protections for homeowners, but given the extreme risks of these complex arrangements, advocates urge that more must be done to rein in other lenders with similar predatory mortgage loan products.  

Set to take effect today, the AG’s rule stems from a law passed in November 2024 as a provision in the Economic Development bill (Section 269) that created a dangerous loophole for homeowners by granting a blanket waiver of liability under Massachusetts consumer protection laws for non-profit SAMs, including BlueHub, stripping away crucial consumer protections and leaving homeowners vulnerable to predatory lending practices. Without eliminating SAMs as an option, the Attorney General’s new rule ensures they are used responsibly and transparently. 

The dangers and risks involved in SAMs has also been recognized by the Massachusetts courts in the class action Humes et al. v. BlueHub Capital, Inc., a case that exposed the hidden, subprime interest rates that plague these mortgage loans and accelerate home loss. The court found that BlueHub is liable for violating several Massachusetts lending laws and recently certified the class to proceed. 

“While presented as a lifeline, shared appreciation mortgages often become a trap,” said Andrea Bopp Stark, senior attorney at the National Consumer Law Center. “The AG’s final rule protects people from BlueHub’s loan model and similar products, but Massachusetts must go further to prevent harm from more common home equity theft loan products, including Home Equity Investment Loans.”

The rule clarifies the limited circumstances under which a SAM lender is insulated from Massachusetts consumer protection claims and provides a strong model for comprehensive notice requirements, such as prominently disclosing the maximum amount a borrower may have to pay under the loan.

BlueHub’s loans and similar products use a dual-mortgage structure that combines a fixed-rate first lien with a delayed profit-sharing second lien. The second lien is the “shared appreciation mortgage” (SAM), in which the homeowner agrees to share a percentage of the appreciation in the home’s value with the lender upon sale, transfer, or refinance of the home. Homeowners are not told a set dollar amount that they will have to pay at maturity, leading to devastating surprises when they try to refinance or sell. In a real scenario documented in Humes, a homeowner owed more than half of their home’s equity to the lender. 

Home Equity Investment (HEI) loans similarly prey on homeowner’s hard-earned equity. HEI lenders offer cash up front for a large balloon payment due at the end of the loan that is based on the variable value of the home at the time the loan is due. While the Attorney General recognizes the risks associated with HEI loans, as outlined in the case Commonwealth of Massachusetts v. Hometap Equity Partners, LLC; the recent regulations do not specifically target HEI loans. 

“The new rules provide important safeguards and requirements for SAMs, and stronger and broader rules are needed to address the high-risk HEI loans that are now targeting Massachusetts homeowners,” said Bopp Stark.

Recommendations for stronger rules to keep families in their homes include:

• Clarifying that all shared appreciation mortgages and HEI loans are mortgage loans, subject to federal and state mortgage laws and regulations; 
• Requiring contractual repayment caps set at reasonable statutory limits;
• Requiring borrowers to meet with independent legal counsel or a HUD-certified housing counselor before signing the loan;  
• Prohibiting overly-restrictive requirements around occupancy, maintenance, and use of the home; and
• Allowing homeowners to sue predatory lenders directly.

Related Resources

• Home Equity Investment Loans Are Subprime Mortgages: Federal and State Policymakers Should Update Rules to Protect Consumers, June 2026
• Maine Governor Signs First-in-the-Nation Law to Protect Homeowners From Home Equity Investment Loans, April 17, 2026
• What States Can Do to Protect Homeowners from Home Equity “Investment” Loans, September 3, 2025